The award certificate represents the extra mile that an employee has gone for the organization and the acknowledgement of the same by the organization. At the same time, is aspirational for other employees who feel motivated to work harder and perform better to get the same treatment. The award certificate makes the employee feel valued and special.
Organizations today are well aware of the importance of having a highly engaged and motivated workforce for consistent business success. They also understand the criticality of a well-designed and efficiently executed employee rewards system in driving employee engagement. In this context, most organizations have traditionally thought that giving monetary or cash rewards to the employees can guarantee the best results. This is perhaps why cash incentives and bonuses were the most popular choice for rewarding employees until quite recently. However, the growing popularity of different types of non-monetary rewards in recent years is challenging that perception. Non-monetary awards can be as simple as saying ‘Thank you’, felicitating the employee in a large gathering, nominating the employee for a training program or giving an opportunity to work on a special project.
Gaining a better understanding of Non-Monetary Rewards As the name suggests, Non-Monetary Awards are those that do not offer a direct financial benefit to the employees. These awards aim to enhance the sense of pride and satisfaction of the employees with respect to their performance and contribution to the organization. These awards are more symbolic and personal in nature. Hence they tend to have a deeper impact on the motivation of the employees and helps strengthen their bond with their organization. As these rewards are not constrained by budgets, they can be more much more creative and frequent as compared to pure monetary rewards.
What makes Non-Monetary Rewards so effective
Studies have shown that Non-Monetary Rewards, can be more motivating for the employees and help in improving productivity and overall employee engagement levels significantly. Hence, an increasing number of organizations are showing a greater preference for these awards as a means of appreciating and rewarding their employees for their good work. Let’s take a look at the possible reasons as to why Non-Monetary Awards works so well:
- Perceived to be more Authentic
A Non-Monetary Award such as a hand-written ‘Thank You’ note can be indicative of the fact that the presenters have invested time and effort in deciding the best way to reward the employee. This in itself adds much more value and meaning to the award in the eyes of the recipients. They get the feeling that their organization truly cares about them as an individual and not just as another business asset. This can contribute greatly to boosting their motivation and performance.
- Helps in establishing a Personal Connection
Unlike monetary awards, non-monetary such as ‘Coffee with the CEO’ ones create a sense of personal connection between the organization and the employees. This is because the organization takes the needs and preferences of the employees receiving the award into consideration while deciding on the form of the award. It is quite the opposite of giving away cash rewards, which tend to be more transactional and impersonal in nature.
- Creates a deeper sense of Belonging
Non-monetary rewards such a Special Project can prove effective in creating a deeper sense of belonging among the employees. This is because employees generally view these rewards in light of the efforts made the organization in ensuring their happiness and satisfaction. These rewards tend to symbolize that they are an integral part of the organization and that their contribution is much valued.
- Less likely to create Discord between Co-Workers
Monetary rewards can often create unnecessary comparisons and unhealthy competition among employees leading to negativity especially among those who haven’t received the award or have received a ‘lesser’ award. However, non-monetary awards such as Training Program or simply a day-off/ time-off tend to minimize such negative feeling that can cause discord among employees. In fact, non-monetary awards tend to be more aspiring for those who haven’t received the awards and act as a motivating factor.
- Ensure a great Employee Experience
Most non-monetary awards also come with several good memories in terms of the manner in which they were presented, the social recognition gained by employees, or even the sense of pride they felt on receiving the award. These positive feelings can keep the employees happy and motivated for long. A well-organized and well-attended award ceremony with the involvement of the senior management complete with selfies and video shoots can make a huge impact. Due to the creative aspect of non-monetary rewards, the entire experience can be much more exciting and memorable for employees.
There are several reasons why non-monetary rewards are gaining more and more popularity with organizations and are perceived as more effective than the traditional monetary awards or so-called cash awards. Non-monetary rewards are likely to offer better results in terms of greater engagement, higher retention, and increased productivity.
Traditionally, regarded as a ‘no-brainer’ form of reward, cash rewards are falling out of favor of employees, reducing their impact on employee motivation. It is time for organizations to move away from the tradition of cash rewards and consider adopting more diverse forms of non-monetary rewards that are likely to be more effective in driving employee motivation.